City Doesn’t Have Money To Raze Northridge Mall

Judge William Sosnay‘s early fall promises of action at the long-vacant Northridge Mall are giving way to a cold winter.

The City of Milwaukee told the court Monday that it doesn’t have the estimated $15 million it would take to demolish the mall, and the mall’s Chinese ownership group, U.S. Black Spruce Enterprise Group, continues to stall on performing the court-ordered demolition.

“Given the realities of it, and the fact that the owners of the property live outside of the country thousands of miles away, and to date have been ignoring, for all intents and purposes, the orders of the court, that places the onus unfortunately on the other side, the city,” said Sosnay at Monday’s status conference. “I think the citizens who live in that area, and this entire community, deserve some kind of response here.”

Given that the 2019 raze order has twisted and turned in court for nearly four years, Sosnay prodded both sides to state what their “final end game” is.

“At this time the city, unfortunately, does not have the funds to raze the mall,” said assistant city attorney Michael Radavich. As Urban Milwaukee reported as far back as April 2019 when the city first filed the raze order, the demolition cost is several times the city’s annual demolition budget. Then-mayor Tom Barrett said the city was exploring using a combination of financing sources.

State law allows a raze order to be issued when repair costs exceed 50% of the building’s value. The Department of Neighborhood Services estimates repairs would cost $6 million and the attached buildings are only assessed for $81,000. Sosnay ruled in the city’s favor in October, and state statutes allow the city to step in to perform the demolition and add the cost to the property owner’s tax bill. But the city has yet to take matters into its own hands, insisting Black Spruce perform the work. Black Spruce already owes the city more than $1 million in unpaid taxes, but has previously fought off tax foreclosure attempts by making partial payments.

With the city seemingly unable or unwilling to act, Black Spruce seems content to wait.

“I think at this point they are just going to wait to see what happens with the appeal and where that goes,” said Black Spruce’s Milwaukee-based attorney Christopher M. Kloth. Black Spruce is appealing Sosnay’s October ruling, which itself was required because of an earlier appeals court ruling that an incorrect standard was used by a prior judge.

Sosnay said the result was unacceptable. He ordered Black Spruce’s owners to appear in person for the next hearing, Jan. 24. One owner, Li Yang, is based in Canada, and her partners are in China. “This court will continue to do everything I have within my power to pursue this and to enforce the orders of this court,” said the judge.

Radavich previously asked that Yang, who appeared in October, be held in contempt and jailed for unpaid fines. In August, the judge issued a $2,000 per day fine for failure to secure the property in accordance with a 2019 agreement.

Black Spruce acquired the approximately 900,000-square-foot complex for $6 million in 2008 and announced a plan to develop an Asian marketplace, but city officials have argued those plans have never progressed in any substantial fashion. DNS officials say the roof is failing, scrappers have illegally stripped many of the mechanical systems and the masonry is in disrepair. The Milwaukee Fire Department has responded to five fires at the mall in 2022, the latest on Sunday.

Northridge opened in 1972. The mall failed for a number of reasons, including a lack of direct freeway access, chain bankruptcies, the cyclical nature of malls and negative perception created following Jesse Anderson‘s murder of his wife in the mall’s parking lot and the subsequent false claim that the couple was attacked by two Black males. The mall’s competitors, including Mayfair, Brookfield Square, Southridge and Bayshore, have all received substantial public subsidies to help finance updates since Northridge closed in 2003.

The city could eventually recoup some of its costs on the matter as part of redeveloping the underlying 46.5 acres as an industrial business park or mixed-use development.

Security at the mall was previously improved after a maintenance worker was killed in July 2019 by a high-voltage transformer. A civil case is still open from that incident.

Kloth started representing Black Spruce this year. The last firm that represented Black Spruce, Von Briesen & Roper, withdrew for breach of contract and is now suing Black Spruce over a pay dispute.

August 2022 Photos

April 2019 Photos